Houses in alleys still retain high prices
According to Family & Society reporters, in August 2023, real estate prices in wards in Cau Giay district such as Quan Hoa, Yen Hoa, Trung Hoa, Nghia Tan, Dich Vong... starting prices without negotiation ranged from 150 - 300 million VND/m2, depending on location and area.
The situation is similar in Dong Da and Hai Ba Trung districts. For example, a 6-storey house located in a 6m wide alley on Nguyen Chi Thanh Street is being sold for 15 billion VND, equivalent to 370 million VND/m2.
In Ha Dong district, real estate prices have also increased "dizzily". This sudden increase in prices has occurred in areas with many amenities such as near the Ring Road 4 under construction, near Aone Mall shopping center and near Park City complex, Phenikaa University, and the University of Procuracy.
According to Cong Ly newspaper, according to a survey on real estate brokerage floors in May 2023, the price of private houses in alleys in Dong Da district is at 167 - 409 million VND/m2. Private houses in Tay Ho district are being advertised for sale at around 110 - 257 million VND/m2, Ha Dong district from 106 - 189 million VND/m2, Thanh Tri district from 100 - 209 million VND/m2, ...
Private houses in alleys in Hanoi do not decrease in price due to focus on real demand. Illustrative photo
Many experts and homebuyers have assessed that the selling price of private houses in alleys in Hanoi's inner city is equal to the selling price of apartments in the mid-range or high-end segment in the same area. Because a previous survey by Tien Phong showed that currently, apartments in some high-end apartment projects in Tay Ho district only have prices ranging from 105 - 156 million VND/m2, while in Ho Chi Minh City, the price is from 105 - 403 million VND/m2.
In fact, from 2021 to 2022, depending on construction characteristics and location, this segment recorded an average increase of 10 - 15%/year, in some places up to 30 - 35%.
According to the explanation, the price of private houses is repeating the scenario of apartments when it continues to increase in the first quarter of the year, after many consecutive quarters of increase in 2022. Therefore, the price level of this segment continues to be pushed up.
However, the level of interest and purchasing power for the Hanoi private housing market decreased. Specifically, the level of interest in private housing in Cau Giay district decreased by 22%, Dong Da district decreased by 26%, Thanh Xuan district decreased by 23%, Long Bien district decreased by 11%.
According to experts, private houses in alleys in Hanoi are often crowded, cramped, and do not come with airy living spaces and amenities… while prices are constantly increasing. Therefore, instead of spending a large amount of money to buy a house in an alley, people tend to choose apartments or long-term rentals to save costs while still ensuring quality of life.
Moreover, in the context of economic recession, the credit room for real estate loans has not really expanded, the interest rate for real estate loans is still high, so people's purchasing power for this segment is not optimistic. At the same time, due to continuous price increases, the price of private houses in alleys in Hanoi has far exceeded the payment threshold of most people's income, so no matter how high the house price increases, the interest of buyers will not increase.
Advantages of serving real needs
According to Dan Tri , some real estate experts believe that in the second quarter of 2023, apartments and private houses are the types of properties that do not have a large price reduction, even maintaining prices or increasing slightly in some areas, so it is unlikely that prices will decrease further.
Mr. Le Bao Long - Strategy Director of Batdongsan.com.vn - commented that real estate serving the real housing needs at affordable prices or with flexible payment schedules will be one of the segments that recover the earliest in the market. Because, owning a house is still an essential need in a country with a constantly increasing population.
Talking to Lao Dong , Mr. Nguyen The Diep - Vice President of Hanoi Real Estate Club mentioned that the price of houses in alleys in the center of Hanoi in recent months has been sold at very high prices.
According to Mr. Nguyen The Diep, because inner-city apartments are often expensive and have their own inconveniences, many people have sought to buy in alleys at reasonable prices to suit their needs and make them convenient for work.
"In essence, the market for houses in alleys is not large. The reason why many people are looking to buy recently is because this segment has many more convenient factors than apartments, is suitable for budgets, and has long-term profit potential.
Some buyers often prefer ground-level houses over owning apartments, accepting to buy houses in narrow alleys, having to park their cars outside every month in exchange for other benefits such as being close to their workplace and children's school," said Mr. Diep.
Dao Vu (T/h)
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